China's ongoing anti-corruption campaign claimed its biggest scalp this week, and some analysts see the government's hard-line stance against graft as a positive for the world's no.2 economy.
"When it comes to the crucial question of whether the leadership will be willing and able to push through difficult structural reforms, its hard-line stance on corruption is a positive sign," said analysts at Capital Economics in a note published on Wednesday.
Former security chief Zhou Yongkang is being investigated for suspected "serious disciplinary violation," state media reported on Tuesday, making him the most senior official to face corruption charges in the history of modern China.
The decision to target Zhou - who previously headed up China's Ministry of Public Security - is bound to send shockwaves through the political elite, analysts said.
"Many will see this trend - and today's confirmation that the campaign has reached the highest ranks of the Party - as signaling worrying infighting within the leadership which will diminish the chances of effective policymaking," Capital Economics said.
"From an economic perspective though, we see the leadership's willingness to pursue this campaign as positive for hopes of significant reform," it added.
Chinese policy makers announced plans to push through hard-hitting reforms following its Third Plenum meeting in November. The measures included the relaxation of the one-child policy, reform of the welfare system to allow migrants to move more freely around the country, more rights for farmers, financial reform and the opening up of state-owned enterprises (SOEs).
President Xi Jinping has vowed to crack down on official corruption, saying he will target high-flying "tigers" as well as lowly "flies." But many industry watchers have questioned Xi's resolve and policy makers to push through these reforms, which are considered vital for boosting economic growth.
Capital Economics noted that the graft crackdown has taken its toll on certain sectors of the economy, such as luxury goods, hospitality and property, but said overall, the campaign should help China's economic progress.